BTMA requests Bangladesh Bank to increase EDF limit

The Bangladesh Textile Mills Association (BTMA) has requested the Bangladesh Bank to increase the Export Development Fund (EDF) limit to $40 million.

If it is not possible to increase the limit, the association has asked to consider extending the repayment period, reads an application, signed by BTMA Mohammad Ali Khokon, sent to the central bank governor on Thursday.

The EDF is a landmark initiative to increase and facilitate exports. However, due to the impact of the Covid-19 situation, the prices of raw materials such as green tamarind, fibre and dye-chemicals in the international market are now more than three times higher. As a result, the current EDF limit of $25 million cannot meet the demand, the application said.

Also, the existing 270 days to repay the loan is not sufficient. After the export of cotton yarn, it takes more time to complete the ancillary activities including its price, the letter added.

The association also said the EDF limit of most of the mills has already been exhausted or overdue. The normal operation of spinning mills will be hampered if the EDF limit is not increased to $40 million and the loan repayment deadline is not set at 360 days and extended to December 2023.